The companies in our portfolio are always looking for advice and insight from someone who has experienced what they’re going through. Instead of just sharing my thoughts, my team and I go to my Affiliates—the 80 people who make up the Webb Investment Network—for more specific advice and more comprehensive answers. We wanted to bring the same collective knowledge to Forbes.
“I am preparing to expand my business internationally—what are some best practices?” is a question we received from one of the founders in our portfolio. This is one of the most critical decisions a company can make. Advice from my Network:
1. There’s no right or wrong way. “There isn’t necessarily a right or wrong way to execute international expansion, or to structure an international organization,” says Andre Haddad, CEO of Turo. “Depending on the product, you might be able to go global in one step, or you might need to go step by step.” But be mindful. “Successful international expansion is by no means easy or accidental,” says Haddad. “It needs to be pursued thoughtfully as part of the company’s core strategy.”
2. Think locally, act globally. Delegate some responsibilities to a worldwide headquarters and let other things be handled by local representatives. “We have always kept finance functions at headquarters, and had sales and marketing with the local General Manager (GM), but this could vary from company to company, depending on the activity levels at the international subsidiaries,” says Cheryl Dalrymple, CFO of Confluent. James Beer, the CFO of McKesson, highlights instances where GMs and HQ should work together: “The functional and local leaders both have a significant say in how the annual review for an individual is written and delivered. Both leaders should also agree on the compensation awards for employees operating in such a matrixed structure.”
3. Get the right people in the right places: Having a clear hierarchy is crucial. “I’ve seen the best results when you have a ‘scout’ go into the market of the county to help find the local GM of the country,” says Dalrymple. “This scout would typically spend months getting to know the market and the opportunity to get a true sense of the skills the GM should possess. They also build a network of people in the space, which can be used to help find your GM.” That GM is then responsible for making local hires for areas like sales and marketing.
4. Communication is key: When there are moving parts that span time zones and hemispheres, communication is more vital than ever. It’s important to have management meetings where the GMs can dial in (and attend live, fairly regularly) so the management team and the GMs have a deep knowledge of what’s going on in each others’ markets. “If the solid line is into HQ, then the headquarters team has to actively work to include theinternational teams in the ‘life’ of the department,” advises Beer. “It’s easy to forget about people based in London and Singapore when you’re sitting with a full ‘to do’ list in the U.S.”